Positive business results
At the end of the first 9 months, the bank's total operating income (TOI) reached VND 9,567 billion, up 19% over the same period in 2022. Net interest income reached more than VND 6,800 billion, up 9% over the first 9 months of the previous year. Boosting revenue from non-credit activities to offset the market's impact on credit, the ratio of non-interest income to total income reached nearly 29%, up more than 6% over the same period. Net income from service activities reached VND 1,315 billion, up 54% over the same period in 2022, of which revenue from payment services accounted for 43% of total service fee revenue. This is the "sweet fruit" of MSB's digital transformation process in enhancing customer experience. Net profit from foreign exchange trading activities reached nearly VND 1,031 billion, up 16% over the same period last year, continuing to promote MSB's pioneering position in this field.
Thanks to revenue growth that was higher than the 8% increase in operating expenses, as of September 30, the cost-to-income ratio (CIR) recorded 31.6%, lower than the 34.8% in the same period last year, demonstrating the effectiveness of the digitalization process as well as the cost management method. Based on the strategy of coordinating smoothly between cost management and increasing profitability, MSB's accumulated consolidated pre-tax profit for the first 9 months reached VND 5,223 billion, equivalent to 83% of the annual plan.
Healthy balance sheet, good asset quality
The bank's total assets as of September 30 reached over VND249,000 billion, up 17% compared to the end of 2022. Total outstanding customer credit reached nearly VND141,244 billion, up 17% compared to the beginning of the year, higher than the industry average growth rate and focused on less volatile areas such as light industrial trade and consumer goods. Customer deposits reached VND129,618 billion, up 11% compared to the end of last year. The ratio of demand deposits to total deposits (CASA) reached 27.71%, marking a recovery after 2 negative quarters, due to fluctuations in mobilization interest rates and the effective implementation of products with high digital content, suitable for customer tastes. In the third quarter of 2023, responding to the direction of the State Bank, MSB reduced interest rates for customers 3 times. Although this directly affects the bank's net interest margin (NIM), MSB still maintains this index at 4.11%, only slightly down compared to 2022.
At the end of the third quarter, the individual NPL bad debt ratio remained at 1.7% before CIC and 1.96% after CIC (according to Circular 02 of the State Bank), demonstrating the bank's efforts in controlling bad debt to strengthen the balance sheet against market impacts.
In addition, regarding capital and liquidity issues, MSB also achieved positive results. The bank maintained abundant liquidity with a loan-to-deposit ratio (LDR) of 68.6%, and a short-term capital to medium- and long-term lending ratio (MTLT) of 29.18%, much lower than the State Bank's requirements. Affirming its solid and effective capital position, MSB's consolidated capital adequacy ratio (CAR) remained stable at 12.6%.
Step by step promoting sustainable development
The Digital Factory (DF) project is considered a core element in MSB's sustainable development orientation. Directly impacting 3 processes: customer approach, approval and post-approval, DF has deployed many customer journeys (CJ) that are almost completely digitized, helping to improve user experience, while minimizing paperwork, procedures, and saving fuel arising from internal processes. Accordingly, customers can borrow to buy a house, borrow for business, borrow on credit through the MSB mBank application or the loan website https://vaydoanhnghiep.msb.com.vn/. The form registration process is done online, saving time and effort for the user. The approval and disbursement process is also shortened to the maximum based on the technology platform, allowing customers to access loans many times faster than the traditional process. On a 100-point CSAT (satisfaction level) scale, customers rated MSB's CJs at over 80 points. Internally, the amount of paperwork generated from operations has also been significantly reduced. MSB set a target of 50% paperless rate by the end of 2023 and has achieved it ahead of schedule. By 2024, this rate will increase to 70%.
On the other hand, with a high commitment to sustainable development orientation, MSB has cooperated with the Ministry of Natural Resources and Environment and received consulting support in issues such as legal regulations on environmental protection; combating climate change, connecting potential green projects; perfecting internal regulations on environmental and social risk management according to international standards; other activities related to participating in seminars in related fields. On the morning of October 20, the Department of Climate Change (under the Ministry of Natural Resources and Environment) and MSB jointly organized a seminar, the two sides exchanged legal regulations on greenhouse gas emission reduction, carbon market and climate change adaptation as well as practical experience in appraising loan projects that meet "green" standards... This is the foundation for MSB to comply with and closely follow, while supporting the bank to complete the development of a sustainable development strategy in the shortest time.
Regarding credit activities, MSB has integrated the environmental and social risk management process into the credit appraisal and approval process since June 1, 2023. The bank also disbursed VND 5,394 billion for green credit categories and approached and supported 81 customers with projects and loans that meet sustainable development criteria, operating in the renewable energy sector and other green economic categories. Recently, after receiving USD 30 million in green finance capital from Proparco, MSB cooperated with IBIS Consulting Group (Interactive Business Inclusion Solution - USA) to complete and update internal environmental and social risk management standards to ensure compliance with international trends and governance criteria. This is a testament to MSB's efforts in the transition towards a green economy, accompanying the Vietnamese Government in the process of bringing net emissions to zero by 2050.
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